Input–output analysis

Saroj Kumar Chapagain and Edeltraud Guenther

Chapter 92 in Elgar Encyclopedia of Life Cycle Sustainability Assessment, 2026, pp 345-346 from Edward Elgar Publishing

Abstract: This section provides an overview of the concept of input–output (IO) analysis and its integration with life cycle assessment (LCA) in the context of sustainability assessment. IO analysis, initially developed by Wassily Leontief in the 1930s, examines the interdependence between sectors in an economy by analyzing the flow of goods and services. The traditional IO analysis has been extended to include environmental performance, leading to environmentally extended IO (EEIO). This approach considers the environmental impacts throughout the supply chain and allows for a comprehensive assessment of the environmental impacts of economic sectors. Using IO analysis in LCA addresses the limitations of process-based LCA (cut-off) and encompasses both direct and indirect relationships in the production system. Additionally, IO analysis includes socio-economic data and provides a triple-bottom-line sustainability assessment, evaluating social and economic impacts alongside environmental impact. The IO-LCA approach offers several advantages, including a holistic and comprehensive assessment, supply chain analysis, thorough impact assessment, and scenario exploration for policy formulation. To enhance its application, it is necessary to expand the availability of sectoral data and enrich the environmental performance matrix. This includes expanding both sectoral variations and temporal changes driven by advancements in technology and production systems.

Keywords: Input-Output Analysis; IO Analysis; Leontief; EEIO; IO-LCA (search for similar items in EconPapers)
Date: 2026
ISBN: 9781035309887
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